A pair of elected legislators – George Town MLA Winston Connolly and East End MLA Arden McLean – have publicly accused the Cayman Islands’ largest law firms of criminality and conspiracy, and called for the prosecution of the partners of those firms.
Outside of a strong rejoinder from Financial Services Minister Wayne Panton and a rather restrained statement from the Cayman Islands Law Society, the response from the general financial services industry was, in a word, nonexistent.
After a full week of silence (given the situation, an interminable, and in our minds inexplicable, delay), Cayman’s financial services sector has finally found its voice. The good news is that voice is cohesive, clear and powerful.
Along with today’s front-page news story, we have printed the statement from Cayman Finance, unedited and in its entirety. In this limited space we will draw out a few key paragraphs.
First, skip ahead to the end. The final sentence reads, “we would urge the movers of the Private Member’s Motion to withdraw the Motion as soon as possible to avoid any additional damage to the Financial Services Industry.”
Carefully note the choice of words “any additional damage” – meaning that Cayman’s financial services sector has already suffered damage because of Mr. Connolly’s and Mr. McLean’s reckless behavior.
In other words, although private members’ motions are usually ceremonial, the allegations that this one contains are so sensational, utterly serious, and concern an industry that is so sensitive, that real and deleterious consequences are already accruing.
(Don’t forget that, in addition to the legislative motion itself, they and Bodden Town MLA Alva Suckoo have introduced additional accusations that local law firms have hired private detectives to follow the MLAs around. To date, they have provided no information publicly to support their allegations).
As Cayman Finance points out, the financial services industry “is directly responsible for more than half of the Islands’ economy, more than half of the government’s revenue and employs more Caymanians than any other industry. In light of its significance to the Islands, any damage to this industry could have far reaching implications for the jurisdiction and its people as a whole.”
In direct response to the specific allegations levied by Mr. Connolly and Mr. McLean, Cayman Finance states, “It is our understanding that the practice of Cayman law outside the jurisdiction is not regulated under the current law, and we are not aware of anyone having asserted prior to now that the practice of Cayman law in the foreign offices could result in the partners of Cayman firms committing a crime under Cayman law.”
Local firms have had foreign offices for more than two decades, and those offices directly contribute some US$32 million in revenue to Cayman’s government every year.
The content of the statement is substantial, and the identity of the group that sent it is just as significant. Far from being a mouthpiece for the law firms under attack, Cayman Finance is the official representative and advocate for Cayman’s diverse financial services sector. In addition to prominent attorneys, its board of directors includes leaders in the fields of accounting, banking, corporate services, consulting, directorships, funds, insurance, trusts and more – in partnership with the public sector.
We have long advocated for Cayman Finance to be more assertive and vocal in countering external threats to our industry (for example, politically motivated “blacklists,” misleading “studies” on “tax havens,” and misguided news stories based on offshore leaks).
We are pleased to see the sector finally raise its head, and its voice, to defend itself strongly against this threat from within.